Washington, D.C. – The Commodity Futures Trading Commission (CFTC) announced the formation of a dedicated task force on August 11, 2008, to aggressively pursue fraud cases within the off-exchange retail foreign currency (forex) market. The task force, established within the Division of Enforcement, responds to legislative changes enacted in June 2008 with the passage of “The Food, Conservation, and Energy Act of 2008,” which bolstered the CFTC’s regulatory authority over the forex market.
CFTC Commissioner Michael Dunn, who leads the agency’s Forex Education and Outreach Task Force, stated the initiative is designed to target “unscrupulous individuals” operating in the forex space. Dunn emphasized the detrimental impact of forex fraud on both unsuspecting investors and the integrity of the broader futures industry. He signaled a firm commitment to working with law enforcement to bring perpetrators to justice.
Stephen J. Obie, Acting Director of Enforcement for the CFTC, echoed Dunn’s sentiments, noting that forex fraud affects a wide range of investors. Obie affirmed that the creation of the retail forex task force demonstrates the CFTC’s dedication to identifying and prosecuting fraudulent activity in the market.
The CFTC has been active in forex enforcement since 2000, filing nearly 100 actions against companies and individuals involved in the sale of illegal forex futures and options contracts. Through these efforts, the agency has secured judgments totaling approximately $560 million in civil monetary penalties and $450 million in restitution for defrauded investors. The newly formed task force aims to significantly expand upon these results. The agency plans to work closely with other federal and state regulatory and criminal authorities in its investigations.
The CFTC’s actions underscore a growing concern about the prevalence of fraud in the rapidly expanding retail forex market and a commitment to protecting investors from illicit schemes.
Source: CFTC.gov
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